A Supply Chain Network Perspective for Electric Power Generation, Supply, Transmission, and Consumption

Abstract: A supply chain network perspective for electric power production, supply, trans-mission, and consumption is developed. The model is sufficiently general to handle the behavior of the various decision-makers, who operate in a decentralized manner and include power generators, power suppliers, the transmitters, as well as the consumers associated with the demand markets. The optimality conditions are derived, along with the equilib-rium state for the electric power supply chain network. The finite-dimensional variational inequality formulation of the equilibrium state is derived, whose solution yields the equilib-rium electric power flows transacted between the tiers of the supply chain network as well as the nodal prices. The variational inequality formulation is utilized to provide qualita-tive properties of the equilibrium electric power flow and price patterns and to propose a computational scheme. The algorithm is then applied to compute the solutions to several numerical examples